American Antitrust Institute Argues Against CVS/Aetna and Cigna/Express Scripts Deals

The American Antitrust Institute (AAI), a 20-year-old nonprofit “devoted to promoting competition that protects consumers, businesses, and society,” came out sternly this week against pharmacy giant CVS’s proposed purchase of insurer Aetna.

“CVS-Aetna would trigger a fundamental restructuring of the US healthcare system,” the group writes in a letter addressed to Assistant Attorney General Makan Delrahim. They also express concerns about Cigna’s recent $52 billion offer to buy pharmacy benefits management (PBM) company Express Scripts. “Stronger incentives to exclude rival PBMs and health insurers and to engage in anticompetitive coordination would harm competition and consumers at all levels.”

There were only a handful of major PBMs in the country prior to CVS’s 2007 merger with Caremark. In 2012, Express Scripts and Medco also combined. Together, those 2 PBMs control more than 50% of the pharmacy benefits market. The third largest, Optum Rx, is integrated with Aetna rival UnitedHealthcare.

The letter says that CVS and Aetna should face a “high hurdle” in explaining how any efficiencies their combination would create could offset competitive concerns—and they believe that the pair would not be able to do that. A move by the Department of Justice (DOJ) to block the deal would be the “only effective remedy.”

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By Ryan Black

www.hcanews.com